1. BUILDING RESPONSIBLE AGRICULTURAL SUPPLY CHAINS OECD-FAO GUIDANCE FOR RESPONSIBLE AGRICULTURAL SUPPLY CHAINS

2. Structure of the presentation 1.Promoting responsible business conduct  OECD Guidelines for Multinational Enterprises 2.Building responsible agricultural supply chains  OECD-FAO Guidance for Responsible Agricultural Supply Chains 3.The way forward 2

3. PROMOTING RESPONSIBLE BUSINESS CONDUCT

4. What is Responsible Business Conduct? Enterprises should: –Avoid and address their adverse impacts –Make a positive contribution to economic, environmental and social progress to achieve sustainable development This applies to all enterprises: –Private, state-owned, and mixed –Multinational and domestic –Large and small 4

5. Why Responsible Business Conduct? 5 Obtain and retain the social license to operate Reduce risks and manage reputation Protect existing value and create new value Facilitate the participation in global value chains First-mover advantages Attract and retain talent

6. OECD Guidelines for Multinational Enterprises Most comprehensive and only government-backed international corporate responsibility instrument Addressed to multinational enterprises operating in or from the 46 adhering countries Adopted in 1976 and regularly updated with the last update in 2011 6

7. Adherents to OECD Guidelines

8. All adhering governments must set up a National Contact Point (NCP) and provide sufficient human and financial resources to allow it to function NCPs should further the effectiveness of the OECD Guidelines: 1.Disseminate the Guidelines and respond to enquiries 2.Contribute to the resolution of issues relating to the implementation of the Guidelines by offering a forum for discussion 3.Identify areas where additional guidance for enterprises is needed (sectors, products, etc.) A unique implementation mechanism

9. By chapter By sector Over 360 cases brought to NCPs since 2000

10. NCP: Netherlands – complaint received in June 2014 Stakeholders: Rabobank (through Bumitama Agri Ltd) and Friends of the Earth Netherlands Major issues: Due diligence, including on human rights Example of a case: Palm oil in Indonesia 10

11. Palm oil in Indonesia - Conclusions 11  In January 2016, stakeholders agreed that Rabobank: –Maintains a dialogue with relevant stakeholders when there was concrete evidence that its clients did not observe its palm oil policy –Modifies its approach to handling complaints

12. Sectoral projects Multi-stakeholder processes Four work streams: −Extractives −Agriculture −Garment and footwear −Finance sector 12  To help enterprises observe the OECD Guidelines in specific sectors

13. BUILDING RESPONSIBLE AGRICULTURAL SUPPLY CHAINS

14. The OECD-FAO Guidance  Help enterprises observe the OECD Guidelines and other major standards  Through a multi-stakeholder advisory group  Two main sections: 1.What - A model enterprise policy 2.How - A five-step framework for risk-based due diligence 14

15. 1. Model Enterprise Policy 15

16. Major existing standards Principles for Responsible Investment in Agriculture and Food Systems of the Committee on World Food Security (CFS-RAI) FAO Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security (VGGT) Principles for Responsible Agricultural Investment that respect rights, livelihoods and resources (PRAI) UN Guiding Principles on Business and Human Rights IFC Performance Standards ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy Convention on Biological Diversity 16

17. 17 Disclose timely and accurate information related to foreseeable risk factors and the response to particular environmental, social and human rights impacts Provide accurate, verifiable and clear information that is sufficient to enable consumers to make informed decisions Hold good-faith, effective and meaningful consultations with communities through their own representative institutions before initiating any operations that may affect them Standards – Some examples

18. 18 Respect international core labour standards Ensure decent wages, benefits and working conditions, that are at least adequate to satisfy the basic needs of workers and their families Strive to improve working conditions Promote the security of employment Seek to prevent abuses of migrant workers Standards – Some examples

19. 19 Establish and maintain, in co-ordination with responsible government agencies and third parties as appropriate, an environmental and social management system appropriate to the nature and scale of operations Prevent, minimise and remedy pollution and negative impacts on air, land, soil, water, forests and biodiversity, and reduce greenhouse gas emissions Ensure the sustainable use of natural resources and increase the efficiency of resource use and energy Standards – Some examples

20. 2. Framework for Due Diligence  Identify, assess, mitigate, prevent and address actual and potential adverse impacts 20 Step 1 Establish strong company management systems Step 2 Identify, assess and prioritise risks in the supply chain Step 3 Design and implement a strategy to respond to identified risks Step 4 Verify supply chain due diligence Step 5 Report on supply chain due diligence

21. 21 A Supply Chain Approach ProductionAggregationProcessingDistribution Cross-cutting enterprises Tenure rights Animal welfare Human rights Food security & nutrition Labor rights Health Governance Environmental protection & sustainable use of resources Technology & innovation CROSS- CUTTING RISKS STAGES SPECIFIC RISKS ENTER- PRISES On-farm enterprisesDownstream enterprises Financial enterprises

22. Addressing adverse impacts 22

23. THE WAY FORWARD

24. 24 Stronger NCP system Wider adherence to the OECD Guidelines for Multinational Enterprises More and better private sector use of OECD due diligence instruments Research on the impacts of responsible business conduct Index to measure and benchmark policies Promoting Responsible Business Conduct

25. 25 Road-test the OECD-FAO Guidance with interested enterprises Develop case studies and due diligence tools tailored to specific enterprises or commodities Build capacity: peer-learning webinars and due diligence trainings Building Responsible Agricultural Supply Chains  Cooperation with FAO, commodity roundtables and industry initiatives

26. THANK YOU! mneguidelines.oecd.org For more information, please contact: Coralie.David@oecd.org